ECONOMICS
COMPOUND INTEREST
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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$2, 980.15
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$3, 021.10
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$3, 232.15
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$3, 712.19
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Detailed explanation-1: -The formula is: Time = 72/r, where r is the rate of interest. The rule of 72 says that it will take about 12 years for an investment to double. The Rule of 72 applies to compounded interest rates and is reasonably accurate for interest rates between 6% and 10%.
Detailed explanation-2: -Solution: We use the present value formula, where A is $20, 000, r is 6% or 0.06, n is 12, and t is 5 years. Approximately $14, 827.45 should be invested today in order to accumulate to $20, 000 in five years.
Detailed explanation-3: -Summary: The future value of $10, 000 on deposit for 2 years at 6% simple interest is $11200.
Detailed explanation-4: -Expert-Verified Answer What is the amount for Rs. 10000 by compound interest at 8% rate for 2 years, when compounded annually? The amount is ₹ 11664.